@MrAyeDee : Let us talk about Lagos State Government Debts!

by Aye Dee

Nigeria’s total external debt is : $9.38

The FG’s share of the total external debt is : $6.92 Billion

The 36 States and the FCT’s share of the total external debt is : $3.01 Billion

Out of this number, Lagos State’s external debt is: $1.02 Billion

The other 35 states and the Federal Capital Territory have a combined $1.99bn as of June 30, 2014.

What this means is that:

Lagos State owes over 30% of the entire external debt the 36 States and FCT are responsible for.

Lagos State owes over 10% of Nigeria’s total external debt.

Debt numbers come from the website of the Debt Management Office Abuja (Source)

If we assume the population of Nigeria is 180 Million and Lagos has a population of 18 Million, that means Lagos accounts for 10% of Nigeria’s population, consequently, the share of each Lagos resident is higher than the share of residents of any other state.

Nigeria’s land mass is 923,768 sq. km , that of Lagos is 3,345 sq. km, which is less than 1/2 of a percentage point.

Which begs the question of where the money this debt represents went.

I ask because:

In 2013, the poverty rate index for Lagos State was 48.6%.  (Source)

Only 2-50% of the population has access to pipe borne water. (Source)

Only 4-73% of the population have their solid domestic waste (poo poo) collected. (Source)

540,000 (3%) of the population still defecate in the open. (Source)

75% of the population of Lagos lives in slums. (Source)

Vehicular density is 224 vehicles per km vs. national average of 15. (Source)

Medical care and education are also below internationally accepted standards, and so on and so forth.

Putting things in perspective, between 2008 and 2012:

Total revenue for Lagos state from all sources was (Naira, Millions) (Source):

2008– 210,426

2009– 262,448

2010– 286,094

2011– 333,795

2012– 358,940

2013- 387,330

Total- 1,682,607

However, the state still had a deficit every single year:

2008– (89,883)

2009– (90,795)

2010– (104,589)

2011– (51,263)

2012– (76,039)

2013- 42,414

Total= (454,983)

So not only has Lagos been borrowing, it has been unable to pay back its debts and generate enough revenue to operate from a positive cash flow position.

Growing up, there was a saying which goes something like this: ‘Borrow, borrow makes me shine’… This is exactly what has happened in the case of Lagos, and long term this is never a good thing, because sooner rather than later, debts have to be paid.

In conclusion, the image of financial prosperity is but a mirage built upon a tremendous debt burden that the state is and has been unable to pay.

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Op-ed pieces and contributions are the opinions of the writers only and do not represent the opinions of Y!/YNaija.

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